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tv   Taking Stock With Pimm Fox  Bloomberg  July 29, 2014 9:00pm-10:01pm EDT

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>> this is "taking stock" for tuesday, july 29. i am cory johnson, in for pimm fox. a surge in interest in tequila.
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first, headlines with su keenan. >> all about twitter in extended trading. the stock surging in extended hours. the company's user base growing at a steady pace. twitter's active users reach 21 million. sales more than doubled to more than $312 million. the company posted second-quarter profits that beat analyst estimates. outside of earnings, president obama announced today more sanctions against russia. the u.s. targeted three russian banks and a state owned shipbuilder. >> if russia continues on its
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current path, the cost on russia will continue to grow. today is a reminder that the united states means when it says. we will rally the international community in standing up for the rights and freedom of people around the world. >> the new u.s. sanctions target the bank of moscow, and united shipbuilding. >> let's start with twitter. shares shooting up double-digit percentages in the after-hours. paul sweeney, what do you call this? when you look at these numbers, i just debate we say we are looking for something bad in these numbers, and i'm looking hard, and i do not see one.
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>> this is a good quarter for twitter. i think investors are getting a little bit of comfort that this is in fact going to be a good stock, a long-term growth story. there was concern about user growth and engagement and what we saw was not only a beat on the topline and bottom-line, but it was coming from the fundamental key metrics like monthly active users, mobile users, and we're seeing them accelerate and keep the growth rate strong. more importantly we saw the company put out some third-quarter guidance that was better than the industry was looking for and without some formal guidance for 2014 that was better than their original guidance. >> when you look at the numbers that they reported today, and what you know about what it relates to engagement and advertising, what has twitter figured out? >> twitter has done a great job this quarter. they are really taking flight. i think that twitter has a lock
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on what you would call advertising in the moment, or real-time marketing. a lot of marketers are very interested in figuring out how to reach people when they are in the moment. for example, last month watching the world cup game, when uruguay bit the ear of the italian layer and all of these marketers jumped in and put in a tweet relating to that. they want something to consistently do something like that, and that can be very powerful. another thing that has been powerful is the fact that marketers who are tv advertisers can use technology from twitter to sync up advertising on twitter that is timed to win their ads are carrying on television. that gives them a good into the tv marketers and to the tv advertisers which is a huge business. >> today's numbers show us that twitter has figured out
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advertising on mobile, a problem that is vexing so many companies in the world of the internet? >> twitter is lucky, it was born mobile. it was born as a mobile service and it is consistently a very strong performer in mobile advertising. facebook is also strong, everybody was worried about a few years ago. death and doom, but they have figured it out. for twitter, there's nowhere to go but up. twitter is very well-positioned to take advantage of that. >> bloomberg west, we do not like talking about stock prices, but this is taking stock. after hours, there were people on twitter saying this was a short squeeze. short is actually very small. >> this is not a short squeeze, we just looked that the numbers
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coming down, it is 7% or 8%. not a great short position here. a lot of people wanted to own this stock, but it has been very volatile since the ipo. has pulled back 50% from its high so there are a lot of people who got burned in the stock. the central question was, is people going to be a niche advertising medium, or is it going to be a mass advertising medium, and that is all driven by the metrics. our people being driven to twitter and staying there? i think numbers we got from the second quarter and increased guidance for the year gives advertisers a consensuses will be a bigger advertising story than we thought. >> they much more interested in the business. $1.60 per user, which was the revenue user poor quarter doubled what it was last year. am i right to look at that and say that they must be contextualizing their ads better if they are getting such higher
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pay for ads? >> they are. the social media that we talk about them it is all about and actualizing the ad. you cannot put a banner ad up there, it will not work anymore. advertisers will not pay for it, it is not appropriate for that type of experience. we will see it in that revenue per user, we will continue to see strong growth. >> are you agreeing that this is better than it was three or four months ago? >> there were a lot of advertisers who specifically bought into twitter in the world cup. they put a lot of marketing effort behind the world cup as well, to attract new users. the proof in the pudding will be how they perform next quarter and fourth-quarter.
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>> coming up, he is closer to being owner of the nba franchise. that and more coming up. ♪ >> yesterday, a record $2
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billion in sale, the sale of the los angeles clippers is headed for completions without the consent of donald sterling. trish regan got a chance to sit down with dick parsons. when did you get? >> i just sat down and little while ago with the interim ceo of the clippers, dick parsons. i am outside the staples center.
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we talked about what it meant for the community, what it means for the country, what it means for the nba. a lot of very relieved people right now that in fact, knowing that this deal is going to get done. $2 billion deal from the sale of the team to steve ballmer will happen. he pointed out that this is important for the country and the community. >> this team actually has the potential to become america's team because of the way they went through this firestorm, the way they hung together, and the way they're going to come out of their corner when the season starts. >> he really thinks that there is potential here for the whole country to rally behind the clippers and for it to become america's team. he also said it is critical and very important that finally donald sterling is stepping
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aside. >> let's not get to a far ahead of ourselves, what the judge said yesterday was a tentative order. he ruled from the bench how we solve the case. he thought that shelley have the right as sole trustee to enter into the agreement with steve. the matter has to be resolved quickly so that he is authorized to sell the team. that has to be finalized, and it will take a couple of weeks to get there. >> so the clippers are moving on, they will have a new team owner, steve ballmer. >> everyone was rooting for a better organization. as a golden state warriors fan, i am hoping for a worse clippers, it is too good right now. he seemed pretty excited.
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>> everyone is excited, and they are now in a position to be more competitive, to attract top talent. while they were going through all of this, any of the top players they wanted to bring to the clippers would not have those conversations with them because they said they did not knew who was going to own a come september. so hopefully now they will be able to get beyond that hurdle. they have a lot of good talent as it is, but now they can move forward. steve ballmer has deep pockets, and he is willing to spend money. >> thank you. stay with the story, it is a fascinating one. the valuation of teams and how they get sold. robert joins me now, he is the founder of inner circle sports.
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talk to me about -- i was surprised how quickly the process went through. we know he'd tried to buy a tivo for. is it a difficult process? >> it is a time-consuming process because of the background checks a potential new owner has to go through. the league does not have an internal security person who works through that and the financial checks. >> you say that, but i actually know that they employed outside private investigators who literally were looking for dirt on steve ballmer so they knew what they were getting into when he bid on the kings. >> they all higher outside security to do due diligence of the do not want to get an a situation where they appointed new owner and then they have a
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crisis to deal with. >> is it different? >> it is the same process and save application and disclosure that everyone must offer. >> guggenheim was the big investment in the l.a. dodgers. talk to me about why the league likes this kind of investor. looking back on the history of these ball, stewardship of the yankees was atrocious. >> josh harris was the buyer. i think we're moving into an era where franchise value has grown so much off the back of large
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media contracts and arena revenues streams, we're seeing larger backers. you're seeing a much more sophisticated market then we had 10 years ago. >> i am a sports business fan, and i look at the price paid for the dodgers and four the clippers, and i'm a northern california guy so i hope that both teams fail, but is there money to be made? >> tv is one of the main drivers, but it is also what you doing with your local revenue? whether it is for your warriors moving to san francisco, it will make them more competitive and give them more dollars to invest and the team. >> the sacramento kings deal will get a new influx of cash around the arena.
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thank you very much. coming up, meet the man who is largely responsible for the company today. why he is thinking of deals, next. ♪ >> xpo logistics came out with
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revenue earnings after the bell today. they have a tremendous m&a track record.
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this was just out 30 minutes ago. >> we were put in touch by mutual context and we were told that this guy, he has done more deals than many bankers on wall street. so what an attractive headline that is. 500 deals by a high school dropout. >> i get credit for all of these deals, but i had a big team. it was a large team of people, and they give them credit. >> we were talking about the word rollup, what you do not like it. >> it is fine, but it reminds me of deodorant. [laughter] what we have done in my previous companies and what we're doing today is a balanced strategy of
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collectively buying great companies with great leaders. today we announced two company's with great leaders. then we grow them, working together with those great people to grow them. that organic growth is part of the story. today we announce 49% organic growth in the company. >> how do you define organic growth? >> taking out acquisitions, just as this is that you owned a year ago. >> that is the right way to do it. why not the bankers? >> he does not use the bankers, he uses them in financing but not m&a advice. he has people on staff who used to be bankers, so it is all done in-house. he is sitting down at the
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negotiating table and getting a sense of what they want to do. he knows the type of people that he can best integrate into his business, and that is working in his favor. the share price of his companies that have been part of this strategy have done incredibly well. >> i love bankers. we use bankers all the time for financing capital and for debt and equity. >> you and up saving money by doing the work in-house? >> it is not about saving money, it is that we have our own in-house expertise. they know the industry very well. >> because you know you industry so welcome we know who the real players are and who are the pretenders? >> absolutely. when i got into this business in
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2011 we put together a team and said let's take 1000 companies that are the best targets. we met all those people, and would talk to them, and we where at it down to 100 targets. those are our competition. now we're to figure out who to buy. >> do you wait for your moment, or is everyone on the shopping list in contact with you? >> we keep the relationship, and some day the stars may line up. >> you look for particular industries which i found interesting. you have key points that you look for, what are they? >> the people. first and foremost, i have to like the team. >> everyone says that, how do you judge that?
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>> it is subjective. you meet someone can be spent time with them, you get along you trust them to be respect them as mutual chemistry. it's a good sign. >> you want to make sure that their position in the market is very strong. we buy companies that are strong and can have still some room to grow. >> you stumbled upon logistics. what was about logistics that really made you excited and made you see this was something you could accomplish? >> looking for something big. i had built for companies up to billionaire size. i look for companies that were big swaths of gdp. transportation is huge, $3 trillion worldwide.
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very fragmented, there are 200,000 -- >> i have to cut you off there. thank you for joining us. more to come after this. ♪
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>> smoking, drinking, overeating not good for you. but what about sitting? sitting can be a leading cause of diabetes, cancer, heart disease. that is why i'm standing right now. a new book came out today called get up, why your chair is killing you. we met this morning by happenstance, and this book is right along my alley.
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pimm fox is twice the man i am, but he does this standing desk thing which he built on his own because he could not wait to get the monitors installed. should we do this? >> we are finding that there are tens of thousands of people who are getting up. the dangers of sitting with respect to the chronic as easy as you mentioned, but on top of that the mental slowing the people feel sitting at their desks every day. people are getting up across america across the world. what we are finding is that people are giving up, it was specially working corporations, they are more alert, more creative, the productivity improves. what i've come to notice is that things are just getting better and better the more more people get up. >> specifically the health risks. tell me about them and why they happen in the body. >> 34 chronic diseases, including cancer and depression, on top of diabetes and obesity.
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>> just because you're legs are folded? >> the huge genetic molecular metabolism is slowed. blood sugar rises, but pressure rises, and all of those toxins cannot be flushed out. >> i took up walking just walking, not running. i would swim. what i started walking 10,000 steps a day, change my diet with a little bit less sugar, i lost 30 pounds in a year. i keep hearing stories like mine from lots of people. they just when they start
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standing. >> i literally heard what i came to here, a 300 pound gentleman lost 25 pounds in six months. he just started walking to work. it is introducing walking into your day. it is quite impressive, all without breaking a sweat. >> why did people start sitting? >> since the industrial revolution, we became seduced in the 1940's, and we became trained to sit at our desks. all of us stuck behind monitors
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and doing hours upon hours of endless e-mails. and then we are in front of the tv and internet, and all of a sudden you spent 15 hours on your bottom and it is not what we are meant to do. >> we have some great corporations that really designed the way we work. they think that they are succumbing to customers about but they had a great role in making the work work. what are they doing in terms of designing furniture? >> credit where credit is due. when still k's came out, they realize there would be an implicit need across corporate america to give people not boxes that they are adding to their desk but industrial grade but professional solutions. this has been the most phenomenally successful enterprise, not just for those
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10 thousand people who actually purchase them, but for getting the idea out that you can walk and work. think of the standard conference, where you said on your bottom and daydream. if you can be walking at 1.5-two miles per hour, one is actually more attentive to those types of calls and interactions. that is what the treadmill desk scenario has told us. people can walk for three hours while at work and lose the pounds. >> steve jobs, mark zuckerberg, the ceo of linkedin, they all walk around the campus. i cannot sit and look at slides anymore. people answer questions
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differently, the number retention might not be the same, what what you talk about and the way about it is very different. >> we have introduced walk and talk meetings and talk meetings in more than 70 u.s. corporations. the dynamic is different. if you had a bad day, one of the best ways to deal with it was to take someone to go for a walk. it is a very intimate thing to do with someone. if you hold a walk and talk meetings exchanging ideas, socrates came up with the idea, it is nothing new. it is a powerful way of interacting with somebody. so much more healthy, and therefore more positive. you're getting that buzz of endorphins. creativity and work. >> halfway through my walk we go up through the steps.
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thank you very much. coming up next, i'm going to speak to the founder of an apparel company that just launched a kickstarter campaign to bring holiday sweaters back into style. ♪ >> in the last 25 years patrone
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has cornered the top shelf tequila market. joining me now is the chief marketing officer. talk to me about selling tequila. i feel like people, most of their experiences will be a horrible one because they drink horrible tequila. >> our mission was to fundamentally change that perception and to evolve from
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that bad college story to the noble spirit that it really is. we have very sophisticated consumers out there. >> i do not know that hard spirits market to well. >> craft spirits, handmade spirits, arch is no craft min ship, we see this doing very well. small distilleries are doing beautiful work. we put the same level of work into the products and brands that we produce, we just do it at scale. >> is there a number for a craft beer? >> there is not a number it is about the process. >> small business in a single place trying to make a particular quality.
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>> absolutely. the craftsmanship. roca patron means rock in spanish. we use a two ton volcanic wheel that crushes the agave. >> how does the price point compare? >> it is serious tequila. >> the production runs smaller because the market might be smaller. is it limited by the process itself? >> the process is certainly more
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labor-intensive. clearly that limits to some degree the speed at which you can produce it. every bottle we produce have the same amount of artisnal care. it stays in contact with the juice, so it is a very complex flavor. >> it sounds more like a wine and less like a spirit. >> absolutely. >> is that a way that people are consuming this? is the business of these kinds of spirits changing? is it demographically driven? >> people are just interested in the back story. they want to understand what they are eating, what they are drink, how things are made. i think that story is really important to them. whether they are drinking it need, on the rocks, or in a cocktail come they want to know that it is real.
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>> your last gig, which was enormously different, you work at radioshack and what ties these together? i would suppose that there is a fair amount of tequila being consumed at radioshack right now. [laughter] it is a very iconic american brand. it is a tough business for them right now. here i am the great fortune of working on a brand with unparalleled brand metrics. everything from brand awareness to all the quality metrics which are enviable for any marketer. for me it is just a an honor. >> i read all of the financials and went through with the books. a technology business in the age of technology that cannot get it together.
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is it about transition to new technology? >> it is hypercompetitive. so much of that leverage is on mobility, and it is a very tricky one. i think the brand is a wonderful one, the people in the business are great people, work hard and have a passion for, but it is hard to find a reason for being. >> thank you very much. now for some news from su keenan. >> ups lowered its full-year profit outlook, shares tumbling the most. the company gained back in april. the shares rose in the after-hours trade as a result,
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and they also reported second-quarter earnings that beat analyst estimates. finally, staying in the u.s. and sticking to a bold acquisition strategy after its biggest rival pfizer. second-quarter profits beat analyst estimates. those are the top headlines. >> thank you. michael simon spent over 20 years making holiday sweaters worthy of conversation. now her launched a kickstarter campaign to make a do-it-yourself holiday sweater. >> this is from the 80's and the 90's, they were very engaging
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and entertaining. >> tell me about this business and what it is like. who bought these things? where? >> everyone bought these things. it was a great time. we used to make fashion in 1976, and that somewhere in the 80's we tried to make a couple of sweaters that were conversational. that is what they got branded as because we started putting things on them and people were touching and feeling them. it was a big hit. we started off in barney's and -- >> lofty establishments. >> everyone had to have them because people were wearing them
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for fun. they were having a great time. then they went away for a little bit. but we were not trying to reinvent them, because this is what we do. >> it was what you do, now it is what i could do or anyone could do. tell me about this new business. >> we feel like this is now. we put the power in the hands of people. we let them dress their sweater, not everybody wants a sweater, but in your home you could put it on your ipad, you could put it on your pillow, on your wine bottle. >> what do we have here? >> a reindeer. >> put a little pizzazz on that patron bottle. >> christmas trees, snowflakes.
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the notion here is that the sweater is making a comeback? >> i do not know if the sweater will make a comeback, but i know that the parties have come back because they're a lot of fun. >> stores selling these waters are really high-end. i saw a great one that showed kids re-creating the pictures that their mother had taken of them over the years. what is it about -- is there some sort of emotional connection? why do people dig this so much? >> that is what it is, and emotional connection, and an engaging quality so that when people wear them they become the life of the party. >> is it a connection to an earlier days when people do not know any better?
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>> we were hiring artists from art institutes of chicago, and we will have them work on the sweaters and they were works of art. >> this one is quite cool. >> we made that one for mary kay years ago. people were selling lots of mary kay just to win one of these. >> imagine if you had had an herbalife sweater. thank you very much, we appreciate it. coming up, a very pressing issue. the juice and smoothie industry is growing by leaps and bounds. ♪ >> juices and smoothies are a
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big business in the united states.
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offering a new finance program to franchisees. we are joined by the ceo of tropical smoothie café. these actual smoothies? >> more beverages. >> we are half smoothies, have food as a revenue base. what is key to us and what is fueling our growth right now is that we are relevant, we have a lot of growth going on, and a lot of support from the franchise. 280 franchisees, 52% of the
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system is operated by multiunit franchisees, so our averages 1-2. >> i do not know much about the restaurant franchise business. what is new these days? >> what is new in the restaurant industry is innovation. a lot of innovation is going on right now. we are on the front end of that. as an example, last year we rolled out a spinach and kale smoothie. the number one selling smoothie represents 6% of our sales. strawberry banana used to be number one, and now you have the island green. it is the number one smoothie by far. >> talk to me about sourcing. does it get difficult when you have things -- like the kale trend, sweeping the nation? my wife is a big kale fan.
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>> we have not had any issues yet, but we go through about 500 pounds of kale and spinach in our cafés annually. it has been a big seller for us. also innovation on the food sides. bringing in spinach, fish tacos. >> how do you get new franchisees? >> what we look at is growing from within. that is what this financing program is all about, helping our existing franchisees grow and get to be multiunit. >> thank you very much. we will have more of taking stock tomorrow. thank you for watching. ♪
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